Discover The Best Home Warranty Companies

If a home warranty is bought for a primary residence, it isn’t tax-deductible on the federal return. But, home warranty premiums can be tax-deductible if it’s taken for an income-producing building.

If you are a tenant in a house who enjoys a home warranty plan that you pay from your pocket, you can’t claim an exemption on the premium. It is only the owner that can benefit from it as a deductible expense.

Typically, the home warranties are good for one year. The service agreement can get renewed every year. During the first year of enrollment, a new user is also provided a few months of free coverage. Many reputable companies provide multi-year plans for coverage. You can also choose the company’s services for 2-3 years on a single purchase.

No, home warranties typically don’t start immediately. If you buy a home warranty through a real estate transaction, the coverage will start on the day the deal gets closed. However, there is a typical 10-30 days waiting period for the new home warranty. However, if the earlier owner transfers ownership, the coverage will start immediately.

A home warranty differs from home insurance regarding what they both cover. Home insurance protects the property from structural damage and emergencies such as fire or theft.

On the other hand, a home warranty protects and offers repairs and replacements of home systems and appliances from normal wear and tear. In short, a home warranty and home insurance protect different parts of the home.

Home warranties can either be bought by the buyer or seller or even gifted by real estate agents after a home is purchased. A home warranty benefits all parties included in the transaction as it offers peace of mind and even cuts down the professional service charges.

With the increase of people purchasing home warranties, there is a significant increase in home warranty scams. Here are some of the ways how you can determine if a home warranty is a scam:

• The Home Warranty Company is not registered in your state
• The claim process is not clear
• You can’t get in touch with a representative from the company

Yes, you can cancel a home warranty anytime. However, this depends on the home warranty companies’ terms and conditions. Some companies charge cancellation fees, but a full amount is also offered if you cancel the plan within 30 days.

Yes, the respective home warranty company can deny a home warranty claim. That is why we advise you to read its terms and conditions before signing up. Some common reasons why your home warranty can get denied include:

• The appliance wasn’t maintained properly
• You already exceeded your coverage limit
• The appliance or system is not included in the home warranty

Home warranties are typically regulated on a federal and state level. Depending on the state, the regulation of a home warranty gets changed. For instance, the Texas Real Estate Commission regulates home warranties in Texas, whereas the Florida Office of Insurance Regulations regulates home warranties in Florida.

Not all companies cover pre-existing conditions, but some cover them. The top three companies covering them include American Home Shield, Select Home Warranty, and 2-10 Home Buyers Warranty.

Check out this guide on pre-existing conditions to learn more about it.